"Predictions are hard, especially about the future" is something Yogi Bera told us a long time ago. Though we cannot predict the future, we can still prepare for the inevitable things that life with through our way. Market volatility shouldn't be a reason to keep us from making long term plans! Listen in for more today on how developing your convictions and applying understanding to present situations is the a great antidote to volatility.
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Josh Klooz:
Hello and welcome in again to another episode of Wisdom and Wealth. Thank you for joining me. Recently I came across the chart, and it was a dispersion of the various Asset managers on Wall Street and their predictions for what the market would do in the coming year. I Don't know about you, but it's an election year and so I've heard, you know various pundits Do what they do and sometimes the predictions are, you know, very Diverse, to put it mildly. And so as I looked at that spread of different you know Predictions of what the market would do in the coming year, and these are for some of the brightest minds on Wall Street. Supposedly it reminded me of the Yogi Berra quote that predictions are hard, especially about the future.
Josh Klooz:
But once you know I finally got done laughing about my own little joke I Think that the question in the premise is probably faulty. To begin with, why should we care what the market's going to do next year? Why should we care more about that Than anything else? Why should we get kind of channeled in on that short-term focus? I don't believe that there's any data out there that would support the fact that that's healthy or helpful. And so as I thought through this, I said. You know, really, there are two things that I think Inoculate you from that short-term focus and, first and foremost, I think it starts with conviction. Whether it was a few weeks ago when we talked about your investment policy statement, you have to have a certain conviction around why you're investing, what you're investing for and the role that that investment plays in the lives of others and of your community. Fundamentally, it comes down to do you believe that it's just Woven into human nature to flourish? Do you believe that, if given enough time and enough opportunity, typically human nature will find a way to serve others in order to Preserve ourselves and in order to, you know, help ourselves? It may sound a little bit obtuse, but it's really not. It's very fundamental. If you believe that Doom is hanging around every corner, that's going to affect your investment philosophy and the way you and the way you view the market Transversely, or conversely, rather, if you, if you look at Yourself as merely a steward of what you have and you want to make sure that you know your resources are allocated appropriately for your needs and for the needs of the economy, you're probably going to be far more successful.
Josh Klooz:
The next piece that I think Inoculates you from that short-term focus is understanding. The marketplace is overrun with information and starve for wisdom, and I couldn't agree more. The understanding piece is knowing that, yes, I have, even though clients and friends and neighbors have more access to information than we've ever had before. It's that understanding piece that they're paying for. They're paying for the ability to understand their Financial situation in this moment in history and how to apply that to the market at large.
Josh Klooz:
The next piece of understanding that I think comes into play is not just understanding what you need, when you'll need it and how, for how long you'll need those resources, but also understanding what you own and why you own that. There's a certain amount of liberty and freedom that comes from the knowledge of knowing that you own well-run companies at a fair price for the long term. You don't own things that are overpriced for the short term, hoping that you can sell them to somebody else and make a quick profit. There's nothing statistically that I have found out there that proves that that is a strategy for long term success or even continued success. So, again, as you look at the upcoming year in an election year this year there's going to be many news stories and many new cycles that will come across our attention span.
Josh Klooz:
As I've always said before, just ask yourself am I going to even remember that this was a story a week from now, much less three months from now, much less three years from now and God forbid 30 years from now? Most of the time the answer is no, and so there's a great deal of freedom that comes from knowing that you don't have to be in tune with every news cycle, because most of the time they're not helpful. But secondly, if you know what your convictions are, deep, deep down in your soul, that inoculates you from a lot of frustration or a lot of angst in the process. And, lastly, understanding what your needs are for your immediate future and for your long term future, and then also what you own that is going to support those needs long term. There's a ton of liberty that comes from that, a ton of freedom that comes from that understanding and that realization.
Josh Klooz:
If you're listening to this and you don't have that conviction, or are struggling to put that conviction into practice, or you don't have that understanding, please reach out to me. I'm more than happy to talk through these ideas with you more in depth, as always. Please like and rate the podcast, as this helps us reach additional listeners and serve additional listeners, and please remember that I'm wishing you and your family continued truth, beauty and goodness in the road ahead. Thank you so much and have a great day.